Peter Foster is the Telegraph's US Editor based in Washington DC. He moved to America in January 2012 after three years based in Beijing, where he covered the rise of China. Before that, he was based in New Delhi as South Asia correspondent. He has reported for The Telegraph for more than a decade, covering two Olympic Games, 9/11 in New York, the 2004 Boxing Day tsunami, the post-conflict phases in Afghanistan and Iraq and the 2011 Fukushima disaster in Japan.

Be careful China does not buy up the business of ideas

Chen Guangcheng, the blind lawyer who was persecuted in China for many years for highlighting the nastier side of the one-child policy, has accused the Chinese government of putting “unrelenting pressure” on New York University to make him leave his post.

The reaction to this story is interesting because it holds up a mirror to the mistrust that bedevils so much of China’s growing engagement with the West, and vice versa.

I don’t want to re-litigate the Chen story. He says the university that took him in is bowing to pressure (the university is in the process of opening a swanky new campus in Shanghai); the NYU authorities say that that allegation is “fanciful and false”. Truth be told, we’ll never know.

And therein lies the difficulty here: the suspicion of self-censorship always lingers where money is involved – and with 25 per cent of all foreign students in the US coming from China, the money is huge.

Whatever the truth of the Chen/NYU story, it is “fanciful” to suggest that the money doesn’t play a part in muzzling people from speaking freely when it comes to dealing with China.

As a former China reporter, I can tell you the challenge working in Beijing wasn’t in getting foreign businesspeople to moan about the egregious behaviour of the Chinese government – stealing IPR, selectively enforcing regulations to favour local companies, rigging courts etc etc – the challenge was to get anyone to go on the record about it.

They feared reprisals and knew from often bitter experience – as Norway discovered after Liu Xiaobo got the Nobel peace prize and Britain is discovering after David Cameron met the Dalai Lama – that the Chinese government would not hesitate to extract them.

The worry, as the value of the Chinese educational market grows, is that same self-censorship is now creeping in the world of education, which – being responsible for the business of ideas – has arguably much more far-reaching consequences.

The influx of Chinese students to America and Britain, as well as our students going the other way is to be welcomed and encourage – not just for financial reasons, but because these exchanges are the only long-term way break down the suspicions and cultural barriers that still govern the relationship.

The problem is that when China’s government gets involved – as it does with its network of Confucius Institutes, and when issuing permits to institutions like NYU and others looking for new revenue streams in the China – the scope for abuse is vast.

That is why, as we reported last year, it was scandalous for Cambridge to accept a GBP3.7m donation from the totally anonymous Chinese Chong Hua Foundation, merely asserting it had ‘no links’ with the Chinese government and providing no further details.

Suspicions of this money were not unwarranted since it was used to endow a chair for Peter Nolan, an academic who had co-authored a book and several papers with Liu Chunhang, son-in-law of China’s former premier Wen Jiabao whose family controls large swathes of the economy.

Perhaps the money was clean and came with no strings attached – but given the way China works it was incumbent on Cambridge to show that, if not legally, then for its own standing as an academic institution.

China will argue that its soft-power outreach is no different from similar efforts by, say, the British Council or the Alliance Française or Germany’s Goethe Institute, but – as Chen Guangcheng’s horrendous treatment testifies – all things are not equal here.

As the Xi Jinping-Obama summit this month rightly highlighted, the world needs much greater engagement with China, but we must do it with eyes wide open and demands for transparency at every turn.

China’s students must be welcomed to Britain and the US with open arms – the propagandist efforts of China’s government to capitalise on that phenomenon (which the Chinese government has little do with) must be guarded against at all costs.